Budget Week Wrap-Up, June 18

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The flurry of documents is only making it harder to keep my desk clean. Not that I'm any good at it anyway.

At the suggestion of my editors (who are trying to keep tabs on things here in Sac Town like everyone else), this is the first of a new, and hopefully short-lived, feature: an end-of-the-week look at where things stand with the budget deficit debate.

Exit Exam Expulsion: An interesting battle is shaping up over the high school exit exam, the state's mandatory pass-or-no-diploma test that's been controversial for most of its ten year existence. The Democratic budget plan calls for suspending the program through July 2013, thus allowing school districts more flexibility in how to spend their reduced their funding. (Note: the test would still be administered in order to comply with federal requirements, but failure wouldn't stop a student from getting a diploma.) The Governor Schwarzenegger says he'll veto it, and the action from majority Democrats has ticked off their fellow Dem -- schools superintendent (and author of the original legislation) Jack O'Connell. "We cannot allow this budget crisis to become an excuse to skirt our responsibility to ensure that all students graduate with at least the minimum level of skills," O'Connell said in a statement.

Five Vacay Days: Speaking of schools, it appears all sides now endorse some ability of K-12 educators to shorten the school year. The guv at one time suggested as many as 7.5 fewer days; Dems have approved a budget plan allowing five days to be sliced off to save money. This is one of several proposals designed to make it easier for local school officials to make do with less money.

They Heard You: Some of the most passionate testimony of the budget conference committee's public hearings came from a young woman named Lynnea Garbett on May 26. Garbett pleaded for lawmakers not to cut funding for programs that help the poor get HIV and AIDS drugs (she lost her job earlier this spring). Garbett's powerful story made the national news.

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Democratic legislators heard her plea. On Wednesday Assembly Speaker Karen Bass mentioned Garbett specifically in announcing that the Dem budget would not cut as much from those programs as Schwarzenegger had suggested.

Cut Or Cash: Both the Schwarznegger deficit package and the Demnocratic plan call for the state to spend $1 billion less on Medi-Cal services in the coming fiscal year. But they get there very different ways. The governor's plan is to ask for a waiver of federal stimulus rules that mandate spending at a certain level, thus allowing California to reduce funding without losing matching funds. Democrats, on the other hand, say their budget assumes the feds will actually give the state the $1 billion in question. Bottom line: both sides want to spend less California cash, but differ on whether that means a smaller program... or a larger federal contribution.

HUTA Hullabaloo: Local officials may be feeling better about one budget-balancing plan to borrow their cash, but they're gearing up for a legal fight over another propsoal now blessed by both the governor and Democratic legislators: taking $1 billion in locally-earmarked money from the Highway Users Tax Account (HUTA). Schwarzenegger had proposed a permanent shift, while Dems are proposing two years. But the League of California Cities says the shift would violate the state constitution unless it's a loan, and they say potholes will only get worse on local streets without money for repairs. Schwarzenegger was challenged on the plan by a local official during an appearance this morning in Fresno. "Somehow we all have to come together," he explained, "and sacrifice." Doubtful you've heard the last on this one.

Open Space Battle Redux: A recurring theme in recent budget crisis years has been whether the state can continue to afford subsidizing local governments when they agree to give property owners a a tax break for keeping land from being developed. That program is known as the Williamson Act, and is projected to cost the state about $35 million. Ranchers and farmers like it, environmentalists like it, and rural counties like it. But the governor has tried to eliminate the funding before to help balance the books... and this year, Democrats have agreed. The spending cut was rejected in the February deficit deal, but now is back, as lawmakers search for cash anywhere they can find it.

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About John Myers

John Myers is senior editor of KQED's new California Politics & Government Desk. He has covered California politics for most of the past two decades, serving previously as Sacramento bureau chief for KQED News and most recently as political editor for KXTV News10 (ABC) in Sacramento. In 2014, he was named one of the nation's top statehouse reporters by The Washington Post. Follow him on Twitter @johnmyers.

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